The AT&T-TimeWarner Merger Is Complete. Next Up: Fox.
(BLOOMINGTON, Ind.) - The approval of AT&T's merger with TimeWarner doesn't necessarily clear the path for the next big media merger.
Comcast is in a bidding war with Disney to buy Fox's movie and T-V production divisions. Its bid was delayed to await the TimeWarner ruling. Both the AT&T and Comcast mergers involve a distributor of content buying a content provider. But IU Maurer School of Law Professor Shana Wallace, who worked in the Justice Department's antitrust division, says there are important differences between the two. Comcast already owns NBC, so buying Fox wouldn't be a pure "vertical" merger of companies which don't compete directly.
And Wallace notes TimeWarner agreed in advance to arbitration in any pricing disputes over its cable channels -- a concession she says appears modeled on a consent decree which allowed Comcast's NBC purchase to go forward. For TimeWarner, the offer helped defuse the Justice Department's claim the AT&T merger would hurt consumers.
A Disney-Fox merger would be a horizontal merger of competitors. Wallace says the Disney offer has been described as "surgically" crafted to combine elements of the companies which don't overlap and make approval easier.
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